Sobha Q1 net nosedives to Rs 12.7 crore

Sobha Q1 net nosedives to Rs 12.7 crore
The Economic Times, July 30, 2009, Page 4

Our Bureau BANGALORE

REALTY major Sobha Developers has seen its net profit nosedive for the first quarter ended June 30, 2009 at Rs 12.7 crore against Rs 50.5 crore for the same period in FY09. Income from operations stood at Rs 177.1 crore (Rs 346.8 crore in the comparable quarter).

Sobha, which bore the after-shocks of the global economic slowdown, has seen a revival in fortunes in Q1 compared to the fourth quarter (Q4) ended March 31, 2009. Net profit in Q1 at Rs 12.7 crore is up 76.39% from Q4 while total income at Rs 178.6 crore was up sequentially 15.6%. “The real estate industry has seen clear signals of revival in demand during the first quarter. With the Indian economy growing at a rate of 6-7% and expected to achieve a higher growth rate in the next couple of years, real estate infrastructure industries are poised to play a more significant role. It will be a domestic driven industry growing at a much faster pace,” a company filing made with the bourses added. On its part, Sobha Developers has realigned debt, brought on board a private equity partner besides successfully completing a QIP raising Rs 500 crore.

According to the filing, these steps have added the much-needed comfort in operations and have helped the company focus on progress in various projects across key cities including Bangalore. The company intends to focus on debt reduction and cost optimisation and believes it is wellequipped to capitalise on the early revival in the Indian economy.

As of June 30, 2009, the company has completed 50 residential/commercial in-house projects and 146 contractual projects covering 31.9 million square feet of built-up space. At present, it has 31 residential/commercial ongoing projects totalling 9.2 million square feet. The company has contractual projects in Karnataka, Kerala, Andhra Pradesh, Orissa, Tamil Nadu, Punjab, Haryana, NCR besides Maharashtra. Sobha’s projects span various segments including plotted development, multi-storey buildings, row houses, villas and integrated townships. On the bourses, the Sobha scrip was down 1.2% at Rs 219 with 3.5 lakh shares changing hands on the BSE.